Security deposit for seized goods remains a deposit, not payment, unless the order clearly shows otherwise.

An amount directed under an interim release order to be furnished as security for seized goods retained the character of a deposit and was not treated as substantive payment, because the wording showed it was intended to safeguard revenue pending adjudication. The cash component, therefore, could not be adjusted as if it were a completed payment unless the order or surrounding facts clearly indicated that effect. Owing to uncertainty over the actual payment position and the impact of the penalty component under the settlement scheme, the matter required fresh consideration by the Tribunal on the settlement and penalty questions.

---

---

Issues: Whether the amount of Rs. 10,00,000/- deposited pursuant to the interim order was a security deposit or a payment, and whether the matter required reconsideration by the Tribunal regarding adjustment under the settlement scheme.

Analysis: The interim order directed release of the seized articles on furnishing security of Rs. 18,00,000/-, with Rs. 10,00,000/- to be deposited in cash and the balance by bank guarantee. The wording of the order showed that the amount was taken as security to safeguard the revenue pending adjudication and not as a substantive payment. In view of the doubts regarding what had actually been paid and what had merely been deposited, and in the absence of a clear factual determination on the effect of the penalty component under the settlement scheme, the matter required re-examination by the Tribunal.

Conclusion: The cash amount was held to be a security deposit and not a payment, and the issue was remitted to the Tribunal for fresh consideration of the related settlement and penalty questions.

Ratio Decidendi: An amount directed to be furnished as security for release of seized goods retains the character of a deposit and cannot be treated as payment unless the order or surrounding facts clearly show otherwise.

---